EOCT Test Semester 2 final

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1 EOCT Test Semester 2 final 1. The best definition of Economics is a. The study of how individuals spend their money b. The study of resources and government c. The study of the allocation of scarce resources d. The study of the different types of economies 2. Which is NOT a basic resource? a. Land b. Labor c. Capital d. Money 3. The supply curve goes and the demand curve goes a. Up / down b. Down / up c. Up / up d. Down / Down 4. Jen decides to go to the movies rather that go out eat at Zaxby s. What is her opportunity cost of going to the movies? a. The movie ticket b. Spending time at home c. The satisfaction of Zaxby s d. The money the movie ticket cost 5. Which of the following is NOT one of the basic economic Q s? a. What will be produced? b. How will it be produced? c. How much should be produced?

2 d. For whom will it be produced? 6. In a market society makes decisions about how goods and services will be distributed whereas in a socialist society makes decisions about how goods and services will be distributed. a. Individuals / corporations b. Businesses / individuals c. Individuals / government d. Government / individuals 7. Businesses receiving revenue from households is an exchange made in the market? a. Product b. Factor c. Money d. Service 8. A business buying the factors of production from a household happens within the market? a. Product b. Factor c. Money d. Service 9. What happens to Price and Quantity if Supply increases along a Demand curve? a. Price rises and quantity drops b. Price drops and quantity drops c. Price rises and quantity rises d. Price drops and quantity rises 10. A critical principal of capitalism is the idea of a. Communal ownership b. Voluntary exchange c. Government regulation

3 d. Limited competition 11. An assembly line can increase a factory s productivity because it allows workers to a. Diversify their skills b. Focus on a specific task c. Put in overtime hours on the job d. Use a wide range of knowledge 12. What is the difference b/w saving and investing? a. Investing is spending later b. Savings are deposits secured for a later undetermined use c. Savings are hoping to get a return d. Investing is self structured 13. Which of the following is not a factor of production? a. Land b. Labor c. Capital d. Wages 14. This is a type of loan paid out over a considerable length of time. Usually 10, 15, or 30 years. a. Bank b. Financial c. Mortgage d. Credit Union 15. Simple interest is determined by multiplying the rate by the whereas compound interest is determined by multiplying the rate by the. a. Average balance / original loan amount b. Original balance / current balance c. Existing amount owed / original balance

4 d. Time / average balance 16. What is the most correct answer concerning minority issues over the last 60 years regarding labor? a. There have been less women entering the work force since WWII. b. There have been less ethnic groups entering the work force since WWII. c. There have been more women and African American entering the workforce since WWII and the Civil Rights movement of the 60 s. d. There have been less African American entering the workforce since the Civil Rights movement. 17. A good example of the effect of learning on income would be that a. Employers who learn to perform high-risk jobs always get paid more b. Workers who learn to make high-demand products are well paid c. Only job applicants with high school diplomas get job interviews d. People with college degrees usually earn more that those with less education 18. Alex and Dylan mow and trim lawns. Currently, each man mows and trims a lawn by himself, but the process takes a long time. They would MOST LIKELY improve their efficiency if a. Alex and Dylan mow a lawn and them trim it together b. Alex mows a lawn while Dylan trims the same lawn c. Alex trims Dylan s lawn while Dylan trims Alex s lawn d. Alex and Dylan reduce the number of lawns they mow and trim

5 19. Who sets EQ price and quantity? a. Producers b. Consumers c. Both producers and consumer d. The supplier 20. Changes in technology affect the curve? a. Supply b. Demand c. Both curves d. Neither curve 21. Changes in income affect which curve a. Supply b. Demand c. Both curves d. Neither curve 22. If David s cost of inputs goes up for his Chicken Finger Business, this will affect his curve and the EQ price will and the EQ quantity will. a. Demand / Rise, drop b. Supply / Rise, drop c. Demand / drop, rise d. Supply / drop, rise 23. If another similar company sets up business across the street from David s Chicken Fingers, this will cause his curve to which will then cause his EQ price to and his EQ quantity to. a. Demand / rise / rise, drop b. Supply / rise / rise, drop

6 c. Demand / drop / drop, drop d. Supply / drop / rise, rise 24. An example of a price ceiling is. This usually happens the EQ point. a. Wages / below b. Minimum Wage / above c. Rent control / below d. Rent control / above 25. An example of a price floor is a. Rent control b. Wages c. Minimum wage d. Capital 26. Which of the following is NOT one of the uses of money? a. Medium of Exchange b. Standard of value ( AKA unit of account) c. Store of value d. Source of Capital 27. Which of the following usually gets the best return? a. CD (certificate of deposit) b. Saving account c. Checking account d. Money market account 28. The following is NOT one of the three types of business structures? a. Sole proprietorships b. Partnerships c. Corporations d. They are all types of business structures 29. Which NOT a characteristic of a sole proprietorship

7 a. One person reaps reward b. One person held responsible c. Shared ownership d. Dividends paid annually 30. A represents all the possible combinations of goods and services that an economy is able to produce with a fixed amount of resources. a. Linear Graph b. Supply and Demand graph c. Production Possibilities Curve d. Production Capacity Table 31. Negotiating with management on behalf of its employees is called a. Arbitration b. Mediation c. Corporate discrepancy d. Collective Bargaining 32. Which of the following is the correct order according to the characteristics listed? One seller / few sellers / large # of firms / unlimited # of firms a. Oligopoly / Monopoly / Perfect Competition / Monopolistic Competition b. Monopoly / Perfect Competition / Monopolistic Competition / Oligopoly c. Perfect Competition / Oligopoly / Monopolistic Competition / Monopoly d. Monopoly / Oligopoly / Monopolistic Competition / Perfect Competition 33. With regard to current labor issues, our Nation has a. Shifted to more service jobs

8 b. Shifted to more manufacturing jobs c. Become less competitive globally d. Become less mobile 34. The Taft-Hartley Act of 1947 was generally viewed negatively by labor unions because it a. Made it illegal to require workers to join the unions before being hired b. Disbanded the American Federation of Labor c. Established right-to-work laws in all states d. Exempted many assembly line workers from the national minimum wage laws 35. Organizers of many high-interest sporting events such as the Super Bowl and the World Series usually set ticket prices lower than the usual equilibrium price, citing fairness to the public as their concern. What names do economists give to the resulting set price and disequilibrium situation? a. Price ceiling; surplus b. Price ceiling; shortage c. Price floor; shortage d. Price floor; surplus 36. is often property (like a house or farm) that the bank will receive if a monetary loan is not paid a. Mortgage b. Land c. Real estate d. Collateral 37. Which of the following is NOT part of GDP? a. Consumer Expenditures b. Government Expenditures

9 c. Taxes d. Net Exports 38. The base year s value is always a. 1 b. 0 c. 50 d Demand for all goods and services within a nation combines to form a. Demand b. Quantity Demanded c. Aggregate Demand d. GDP demand 40. The aggregate supply curve is a. Downward sloping b. Upward sloping c. Flat d. Vertical 41. When a person is out of work b/c their skills don t match the job, this is called unemployment a. Cyclical b. Seasonal c. Frictional d. Structural 42. When a person is out of work due to a period of layoffs and recession, we call this unemployment a. Cyclical b. Seasonal c. Frictional d. Structural 43. Rising costs can create this type of inflation

10 a. Cost push b. Cost pull c. Demand pull d. Cost appropriate 44. Which of the following tools of the FED has the most immediate affect on the money supply a. Changing the discount rate b. Open market operations c. Raising reserve requirements d. None of the above 45. What problem might policymakers be trying to address if they increase funding of training programs covering skills such as computer repair, programming and networking? a. Frictional unemployment b. Structural unemployment c. Cyclical unemployment d. Seasonal unemployment 46. Government officials adopt an expansionary fiscal policy. Which action would be most consistent with this policy a. Raising the discount rate b. Buying government bonds c. Increasing government spending d. Raising personal income tax rates 47. Over a two-year period, the nation of Parthia experiences a steep decline in the unemployment rate, a rise in real GDP, and a stabilized price level. Parthia appears to be a. At the start of a recession b. At the beginning of a recession

11 c. Stagnating economically d. In the middle of a boom period 48. If the unemployment rate is rising and the GDP is falling, the fiscal policy that the federal government should MOST likely follow is a. Decreasing taxes b. Decreasing spending c. Decreasing the money supply d. Decreasing the reserve requirement 49. The nation of Welton needs to build a new dam to control flooding near its largest city. If Welton is a purely market economy, then these new improvements will be MOST likely be left up to a. The government b. The individuals who are willing to pay for the new dam c. Anyone who would benefit from the dam d. The owners of the property on which the dam would be built 50. A nation that has a comparative advantage in the production of some product should a. Make all the products it is good at b. Specialize in making that product that it is best at c. Avoid trade d. Manufacture more and export less 51. This limits the amount of goods that can be brought into a country a. Embargo b. The SEC c. NAFTA d. Quotas

12 52. Over the course of one year, the Japanese yen depreciates relative to the euro; which group of people would benefit the most from this occurrence? a. European consumers of European goods b. European consumers of Japanese goods c. Japanese consumers of Japanese goods d. Japanese consumers of European goods 53. Those in favor of protectionist trade policies would MOST likely a. Support a reduction in tariffs b. Call for fewer import restriction c. Cite the need to preserve domestic industries d. Believe that restrictions harm consumers 54. Milo farms the same small plot of land his ancestors farmed. He exchanges wheat for products he needs from local producers. The exchange value of the wheat changes little since the trade is governed by custom. What kind of economic system is Milo operating in? a. Command b. Traditional c. Market d. Capitalist 55. A tariff placed on foreign steel imports represents a. A barrier to trade b. A balance of payments deficit c. A subsidy to domestic producers d. An increase in domestic production

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